Celestial Asia Securities : DISCLOSEABLE TRANSACTION IN RELATION TO RENEWAL OF TENANCY AGREEMENT

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CELESTIAL ASIA SECURITIES HOLDINGS LIMITED

時富投資集團有限公司*

(Incorporated in Bermuda with limited liability)

(Stock code: 1049)

DISCLOSEABLE TRANSACTION

IN RELATION TO

RENEWAL OF TENANCY AGREEMENT

THE RENEWAL TENANCY AGREEMENT

The Board announces that on 4 September 2019, Pricerite Home Limited (a subsidiary of the Company) as the Tenant entered into the Renewal Tenancy Agreement with the Landlord (Independent Third Party) to renew the Existing Tenancy Agreement for operation of store of retail management business of the Group.

IMPLICATIONS UNDER THE LISTING RULES

Upon implementation of HKFRS 16 effective from 1 January 2019, the Group if entering into lease transaction as a lessee should recognise the right-of-use asset in the consolidated financial statements of the Company according to HKFRS 16. Under the Listing Rules, the entering into lease transaction by the Group as lessee effective from 1 January 2019 will be regarded as an acquisition of asset under the definition of transaction set out in Rule 14.04(1)(a) of the Listing Rules.

As the applicable percentage ratios (as defined under Rule 14.04(9) of the Listing Rules) for the lease transaction contemplated under the Renewal Tenancy Agreement exceed 5% but are below 25%, such transaction constitutes a discloseable transaction of the Company and is subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

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INTRODUCTION

The Board announces that on 4 September 2019, Pricerite Home Limited (a subsidiary of the Company) as the Tenant entered into the Renewal Tenancy Agreement with the Landlord (Independent Third Party) to renew the Existing Tenancy Agreement for operation of store of retail management business of the Group.

THE RENEWAL TENANCY AGREEEMENT

Date:	4 September 2019
The Landlord:	Link Properties Limited as the Landlord.
	The principal or ancillary activities carried on by the Landlord are property
	holding and leasing.
	To the best of the Directors' knowledge, information and belief, and having made all
	reasonable enquiries, the Landlord and its ultimate beneficial owners are the
	Independent Third Parties.
The Tenant:	Pricerite Home Limited (a subsidiary of the Company).
The Premises:	Shop no. N212, Second Floor (also known as Level 2), Multi-Storey
	Commercial/Car Park Accommodation (forming part of Temple Mall North), Upper
	Wong Tai Sin Estate, Lung Cheung Road, Wong Tai Sin, Kowloon, Hong Kong.
Terms:	Two (2) years and three (3) months and fifteen (15) days from and including 2
	July 2019 and expiring on 16 October 2021.
The aggregate	The aggregate value of consideration payable under the Renewal Tenancy
value of	Agreement including rent, stamp duty and estimated reinstatement cost by the
consideration	Tenant is approximately HK$14,410,000, which will be satisfied by internal
payable:	resources of the Group.
	The rent under the Renewal Tenancy Agreement is determined after arm's length
	negotiations between the Landlord and the Tenant, after taking into consideration
	the prevailing market price for comparable premises in the vicinity of the Premises
	and the existing rental under the Existing Tenancy Agreement.
Payable term:	The rent shall be payable monthly in advance on the first day of each month.

THE RIGHT-OF-USE ASSET

The value of the right-of-use asset recognised by the Company under the Renewal Tenancy Agreement amounted to approximately HK$13,761,000, which is the present value of aggregated lease payments, plus initial direct costs and estimated reinstatement cost with the lease in accordance with HKFRS 16. Discount rate of 4.125% is applied to compute the present value of aggregate lease payments under the Renewal Tenancy Agreement.

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INFORMATION OF THE GROUP

The principal activity of the Company is investment holding. The principal activities of the Group consist of (a) retail management business including sales of furniture and household items and electrical appliances through the chain stores under multi-brand names including "Pricerite", "TMF", "SECO", "Galleon" and "W@W" in Hong Kong; (b) mobile internet services business; and (c) general investment holding. For additional information, please visit www.cash.com.hk.

Based on the audited accounts of the Company, the net losses (before taxation and extraordinary items) for the financial year ended 31 December 2017 were approximately HK$109.3 million and the net profit (after taxation and extraordinary items) was approximately HK$23.9 million respectively, and the audited net asset value as at 31 December 2017 was approximately HK$508.1 million.

Based on the audited accounts of the Company, the net losses (before taxation and extraordinary items) for the financial year ended 31 December 2018 were approximately HK$135.6 million and the net losses (after taxation and extraordinary items) was approximately HK$204.9 million respectively, and the audited net asset value as at 31 December 2018 was approximately HK$307.4 million. The unaudited net asset value of the Company as at 30 June 2019 was approximately HK$261.7 million.

REASONS FOR THE RENEWAL TENANCY AGREEMENT

One of the principal businesses of the Group is operation of retail management businesses through our chain stores under multi-brand names including "Pricerite", "TMF", "SECO", "Galleon" and "W@W" in Hong Kong. Due to nature of its retail management business, the Group has to enter into tenancy agreements for leasing of retail shops from time to time.

In addition, the terms of the Renewal Tenancy Agreement (including the rental charge) were determined after arm's length negotiations between the parties and with reference to the open market rent of comparable properties and the rental payment made by the Group under the Existing Tenancy Agreement. The Board considers that the terms of the Renewal Tenancy Agreement are on normal commercial terms and fair and reasonable and entering into of the Renewal Tenancy Agreement is in the interests of the Company and the Shareholders as a whole.

IMPLICATIONS UNDER THE LISTING RULES

Upon implementation of HKFRS 16 effective from 1 January 2019, the Group if entering into lease transaction as a lessee should recognise the right-of-use asset in the consolidated financial statements of the Company according to HKFRS 16. Under the Listing Rules, the entering into lease transaction by the Group as lessee effective from 1 January 2019 will be regarded as an acquisition of asset under the definition of transaction set out in Rule 14.04(1)(a) of the Listing Rules.

As the applicable percentage ratios (as defined under Rule 14.04(9) of the Listing Rules) for the lease transaction contemplated under the Renewal Tenancy Agreement exceed 5% but are below 25%, such transaction constitutes a discloseable transaction of the Company and is subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

DEFINITION
"Board"	board of Directors
"Company"	Celestial Asia Securities Holdings Limited (stock code: 1049), a
	company incorporated in Bermuda with limited liability and the
	shares are listed on the main board of the Stock Exchange
"connected person(s)"	has the meaning ascribed to it in the Listing Rules
"Director(s)"	director(s) of the Company
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"Existing Tenancy Agreement"	the tenancy agreement dated 31 October 2014 entered into between
	the Tenant and the Landlord in relation to the tenancy of the
	Premises which has been expired on 2 July 2019
"Group"	the Company and its subsidiaries
"HKFRS"	Hong Kong Financial Reporting Standards
"Hong Kong"	the Hong Kong Special Administrative Region of the PRC
"Independent Third	to the best of the directors' knowledge, information and belief
Party(ies)"	having made all reasonable enquiry, the Landlord and its ultimate
	beneficial owners are third parties independent of the Company and
	its connected persons (as defined under the Listing Rules)
"Landlord"	the landlord as more particular set out under the sub-heading "The
	Landlord" in the section headed "The Renewal Tenancy
	Agreement" in this announcement
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock Exchange
"PRC"	the People's Republic of China, excluding Hong Kong, Taiwan and
	Macau Special Administrative Region of the PRC
"Premises"	the premises as more particular set out under the sub-heading "The
	Premises" in the section headed "The Renewal Tenancy Agreement"
	in this announcement
"Renewal Tenancy Agreement"	the tenancy agreement dated 4 September 2019 entered into between
	the Tenant and the Landlord in relation to the renewal of tenancy of
	the Premises under the Existing Tenancy Agreement
"Shareholder(s)"	holder(s) of shares of the Company
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Tenant"	Pricerite Home Limited, a company incorporated in Hong Kong
	with limited liability, is an over 90%-owned subsidiary of the
	Company
"%"	per cent.
	By order of the Board
	Suzanne W S Luke
	Company Secretary
Hong Kong, 4 September 2019
As at the date hereof, the directors of the Company are: -
Executive directors:	Independent non-executive directors:
Dr Kwan Pak Hoo Bankee, JP	Mr Leung Ka Kui Johnny
Mr Chan Chi Ming Benson	Mr Wong Chuk Yan
Mr Leung Siu Pong James	Dr Chan Hak Sin

Mr Ng Hin Sing Derek

Mr Kwan Teng Hin Jeffrey

* For identification purposes only

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